Market news
06.10.2023, 04:30

Silver Price Analysis: XAG/USD remains confined in familiar range, bearish potential intact

  • Silver edges higher during the Asian session on Friday, albeit lacks follow-through.
  • The range-bound price action could be categorized as a bearish consolidation phase.
  • The oversold RSI on the daily chart might hold back bears from placing fresh bets.

Silver attracts some buyers during the Asian session on Friday and currently trades around the $21.00 mark, up nearly 0.20% for the day. The white metal, however, remains confined in a familiar range held over the past four days and the technical setup suggests that the path of least resistance is to the downside.

The subdued range-bound price action constitutes the formation of a rectangle on hourly charts. Against the backdrop of the recent sharp rejection slide from a technically significant 200-day Simple Moving Average (SMA), this might still be categorized as a bearish consolidation phase. This, along with last week's breakdown through the $23.30-$23.20 horizontal support, validates the near-term negative outlook for the XAG/USD.

That said, the oversold Relative Strength Index (RSI) on the daily chart is holding back traders from placing fresh bearish bets and positioning for any further depreciating move. Meanwhile, any subsequent move up might still be seen as a selling opportunity near the $21.40 region. A sustained strength beyond, however, might trigger a short-covering rally and allow the XAG/USD to reclaim the $22.00 round-figure mark.

The next relevant hurdle is pegged near the $22.20-$22.30 strong horizontal support breakpoint, which should now act as a key pivotal point for short-term traders. A sustained strength beyond will negate the negative outlook and shift the near-term bias in favour of bullish traders.

On the flip side, the $20.70-$20.65 zone, or a nearly seven-month low touched this week, might continue to act as immediate support and protect the downside. Some follow-through selling, however, should pave the way for a slide towards challenging the YTD trough – levels just below the $20.00 psychological mark touched in March.

Silver daily chart

fxsoriginal

Technical levels to watch

 

© 2000-2024. All rights reserved.

This site is managed by Teletrade D.J. LLC 2351 LLC 2022 (Euro House, Richmond Hill Road, Kingstown, VC0100, St. Vincent and the Grenadines).

The information on this website is for informational purposes only and does not constitute any investment advice.

The company does not serve or provide services to customers who are residents of the US, Canada, Iran, The Democratic People's Republic of Korea, Yemen and FATF blacklisted countries.

AML Website Summary

Risk Disclosure

Making transactions on financial markets with marginal financial instruments opens up wide possibilities and allows investors who are willing to take risks to earn high profits, carrying a potentially high risk of losses at the same time. Therefore you should responsibly approach the issue of choosing the appropriate investment strategy, taking the available resources into account, before starting trading.

Privacy Policy

Use of the information: full or partial use of materials from this website must always be referenced to TeleTrade as the source of information. Use of the materials on the Internet must be accompanied by a hyperlink to teletrade.org. Automatic import of materials and information from this website is prohibited.

Please contact our PR department if you have any questions or need assistance at pr@teletrade.global.

Bank
transfers
Feedback
Live Chat E-mail
Up
Choose your language / location